Tough choices ahead: HRM council prepares to grapple with budget

In his final appearance before council after announcing his resignation in the spring, Halifax's outgoing Chief Administrative Officer Jacques Dubé delivered a warning to elected officials about the tough choices they'll have to make in the not too distant future.

"This is all about sustainability," Dubé said. "If you don't make hard decisions today, decisions will be way harder in future years."

Much of it was summed up in a pre-budget report delivered to council last week, painting a somewhat gloomy picture of the city's finances, noting the Halifax Regional Municipality is facing “significant economic headwinds," including inflation at "levels not seen since amalgamation.”

The municipality’s once strong financial position is showing "signs of erosion," it warns.

According to city staff, the best solution is an eight per cent increase in property taxes across the board.

It works out to about $173 a year for the average homeowner, almost $4,000 annually for businesses.

"I was surprised and concerned," said Halifax Mayor Mike Savage, who's often worked to keep tax-hikes to a minimum.

Savage says these are early days in the budget process, but the current circumstances are unlike anything ever seen before, and the crunch will factor into nearly everything council does for the foreseeable future.

"I think one of our favourite words in the years to come is going to be 'value engineering,'" said Savage.

"(We'll) look at projects and say, 'Is there a cheaper way to do this and still hit the target of what people need?'"

Dubé told council a number of projects will have to be shelved for the time being, but spending on infrastructure has to ramp-up.

"Because we're not keeping up with demand because of population growth," he said. "We're growing by a town the size of Truro every year."

But the notion of an eight per cent tax increase is already a non-starter for some groups.

"Simply unsustainable," said Kevin Russell, the executive director of the Investment Property Owner's Association of Nova Scotia (IPOANS), in a news release. 

“Because of the Nova Scotia government’s rent cap, rental housing providers have no way to pass along increased costs. With energy costs skyrocketing, a federal carbon tax about to be imposed on Nova Scotia, insurance premiums, labour costs – everything is getting more expensive.  The last thing we need is the municipal government piling on another tax hike.”

Tuesday's short budget meeting comes ahead of a daylong one scheduled Friday.

The beginning of a long discussion about tough choices to be made in the not too distant future.